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The fight for IT offshoring's future

Gartner research last year stated that IT service firms need to leverage automation tools offered by software vendors, as well as develop their own tools. What role can automation play in the transition to a more industrialised outsourcing model?

“Increased efficiency, reduced costs”. The mantra that every tired CIO in the country uses to send himself to sleep is fast becoming tired itself. As more pressure is being put on CIOs to deliver more with less, the industry needs to get itself into gear before it can transform. One could argue that the IT outsourcing industry needs to undergo its own industrial revolution, and move from an aging manual labour economy towards a more modern automated machine-based solution.

In November 2010 Gartner published their “predicts” report on the future of the IT Services market. The research states “by 2015, tools and automation will eliminate 25% of labour hours associated with IT services. As the IT service industry matures, it will increasingly mirror other industries, such as manufacturing, in transforming from a craftsmanship to a more industrialized model. Automation is part of this transition.” Automated technologies can learn from human behaviour so that simple everyday tasks can be handed over to IT systems and solved before human intervention is required.

Traditional outsourcers have been faced with an increase in growth in terms of servers managed but a decline in the amount of resources needed to manage them effectively. Profitability issues aside, the amount of man hours wasted on management of these data centres has skyrocketed. For this reason, outsourcing organisations should be looking at automation as a viable option for optimising their infrastructure.

Clients will increasingly look at aligning IT outsourcing cost and consumption and as a consequence accessing services. Industrialised offerings will need to address key items, such as compliance, demand management, integration, pricing mechanisms and security.

Dubbing this transition a revolution is a bit of a misnomer. The traditional outsourcing model will survive, but needs must. A more industrialised and automated infrastructure is central to protect profitability in a market notorious in recent years for its stagnant growth.

 

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